The city said it’s deciding if it will appeal the decision to the state Supreme Court -- an option that is well within their legal right but is considered a long shot.

The latest decision by an appeals court has one local uniform distributor telling the city, “I told you so.”

At American Police Equipment on Airline Highway, owner Charlie Hewlett is breathing a big sigh of relief.

After nearly a year of fighting, Hewlett beat City Hall in court.

The win comes months after a civil court judge sided with the city, approving a massive contract Hewlett thought he deserved. Instead, the deal was awarded to a rival business.

Now, a state appeals court is turning the ruling upside down, nullifying the lower court’s decision.

“The appeals court confirmed that our interpretation of the law was correct,” Hewlett said.

The debate centers on a City Hall contract for police uniforms and gear, which is potentially worth $500,000 annually.

Hewlett, who has provided cops with gear and clothing since 1977, was not the low bidder on the contract.

A company called “Signal 26” was.

Critics pointed out that Signal 26 had no store front, and based on records obtained by the I-Team, registered a Lakeview home as its address.

When it won the contract, Signal 26 noted that it also does business by another name – Code 3.

That company listed two women as the owners: Rachel Hurst and Rebekah Hoffacker.

Hoffacker is married to a New Orleans police officer.

New Orleans laws state that relatives of city employees cannot do business with the city. However, Signal 26 was still awarded the contract.

“Even if any of these allegations could stick - he's still not the low bidder and at the end of the day we were substantially lower than his overall bid,” Hoffacker said.

The I-Team obtained letters sent by some of the largest police uniform and equipment suppliers in America to City Hall. In each, the suppliers argued against awarding the contract to Hurst, but it didn’t matter.

Now, an appeals court says the contract is null and void.

“We knew it was improper for a police officer's wife to do business and get a contract from the city of New Orleans,” Hewlett said.

The city is still honoring the contract with Signal 26, or Code 3, but Hewlett said based on the most recent court decision, he should be awarded the contract or it should be re-bid by the city.

The Mayor’s Office said it is still deciding whether to appeal the state supreme court.

Under the current deal each individual officer can spend up to $500 a year at Code 3 and that the company gets reimbursed by the city.

LEAD TO SIGNIFICANT DEVELOPMENTS IN THE WAY POLICE OFFICERS ARE OUTFITTED. IT'S AN UPDATE TO A STORY THE WDSU I-TEAM BROKE LAST SUMMER. INVESTIGATIVE REPORTER TRAVERS MACKEL IS LIVE AT SIX WITH WHAT THE CITY SAYS ABOUT LOSING THIS LEGAL BATTLE. THE CITY SAYS IT'S NOW DECIDING IF IT WILL APPEAL THIS DECISION TO THE STATE SUPREME COURT ... AN OPTION THAT IS WELL WITHIN THEIR LEGAL RIGHT, BUT IS CONSIDERED A LONGSHOT. AND THIS LATEST DECISION BY AN APPEALS COURT HAS ONE LOCAL POLICE UNIFORM DISTRIBUTOR TELLING THE CITY "I TOLD YOU SO." AT AMERICAN POLICE EQUIPMENT ON AIRLINE HIGHWAY, OWNER CHARLIE HEWLETT IS BREATHING A BIG SIGH OF RELIEF ... it's been a long ardent trip. THAT'S BECAUSE AFTER ALMOST A YEAR OF FIGHTING, HEWLETT BEAT CITY HALL IN COURT. THE WIN COMES MONTHS AFTER A CIVIL COURT JUDGE SIDED WITH THE CITY - APPROVING A MASSIVE CONTRACT HEWLETT THOUGH HE DESERVED. INSTEAD, THAT DEAL WAS AWARDED TO A RIVAL BUSINESS. NOW, A STATE APPEALS COURT IS TURNING THE RULING UPSIDE DOWN - NULIFYING THE LOWERS COURTS DECISION. the appeals court confirmed that our interpretation of the law was correct. THE DEBATE CENTERS ON A CITY HALL CONTRACT FOR POLICE UNIFORMS AND GEAR , POTENTIALLY WORTH HALF A MILLION DOLLARS ANNUALLY. THE WDSU I-TEAM FIRST REPORTED ON HEWLETT'S CONCERNS LAST JULY. it's a strange situation. HEWLETT - WHO'S PROVIDED COPS WITH GEAR AND CLOTHING SINCE 1977 - WAS NOT THE LOW BIDDER ON THE CONTRACT. A COMPANY CALLED SIGNAL 26 WAS. BUT CRITICS POINTED TO A PROBLEM:THAT COMPANY HAD NO STORE FRONT, AND BASED ON RECORDS OBTAINED BY THE WDSU I-TEAM - REGISTERED THIS HOME IN LAKEVIEW AS IT'S ADDRESS. WHEN IT WON THE CONTRACT, SIGNAL 26 NOTED THAT IT ALSO DOES BUSINESS BY ANOTHER NAME - AS CODE 3. THAT COMPANY LISTED TWO WOMEN AS THE OWNERS: RACHEL HURST AND REBEKAH HOFFACKER. HOFFACKER IS MARRIED TO A NEW ORLEANS COP - AND NEW ORLEANS LAWS STATE RELATIVES OF CITY EMPLOYEES CANNOT DO BUSINESS WITH THE CITY. STILL, OFFICIALS AWARDED THE CONTRACT TO SIGNAL 26. HURST DEFENDED HER COMPANY TO US LAST SUMMER WHEN QUESTIONED ABOUT THE POTENTIAL CONFLICT. even if any of these allegations could stick - he's still not the low bidder and at the end of the day we were substantially lower than his over-all bid. THE WDSU I-TEAM OBTAINED LETTERS SENT BY SOME OF THE LARGEST POLICE UNIFORM AND EQUIPMENT SUPPLIERS IN AMERICA TO CITY HALL. IN EACH, THE SUPPLIERS ARGUED AGAINST AWARDING THE CONTRACT TO HURST - BUT IT DIDN'T MATTER. NOW AN APPEALS COURT SAYS THE CONTRACT IS NULL AND VOID. we knew it was improper for a police officer's wife to do business and get a contract from the city of new orleans. SO THE BIG QUESTION: WHERE DO POLICE OFFICERS GO NOW FOR NEW GEAR AND UNIFORMS? THE CITY SAYS IT IS STILL HONORING THE CONTRACT WITH SIGNAL 26 OR CODE THREE, BUT HEWLETT SAYS BASED ON THIS MOST RECENT COURT DECISION - HE SHOULD BE AWARDED THE CONTRACT OR IT SHOULD BE RE-BID BY THE CITY. THE MAYOR'S OFFICE SAYS IT'S STILL DECIDING WHETHER TO APPEAL TO THE STATE SUPREME COURT. UNDER THE CURRENT DEAL: EACH INDIVIDUAL OFFICER CAN SPEND UP TO $500 A YEAR AT CODE 3 AND THAT COMPANY GETS REIMBURSED BY THE CITY. A BASIC CITY SERVICE MISSING

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